Opening in 1902 as the Mount Vernon Hospital, the asylum helped ease Bryce Hospital's overcrowding. In 1919, the hospital was renamed Searcy Hospital in honor of the hospital's first superintendent, Dr. J.T. Searcy. Unlike the other asylum, it only treated African-Americans up until 1969 (which was changed due to the Civil Rights Act of 1964). The hospital contained 400 extended-care beds and 124 intermediate-care beds for patients with severe illness in 2010.

On February 15th, 2012, the Alabama Department of Mental Health announced that it was going to close Searcy and all but two of its state-run mental hospitals. It is expected to fully close by September, 2013.